ABSTRACT
The project manager depends upon timely information to make those key decisions that result in effective management of project costs. At the time a proposal is made, a cost-manacement plan (CMP) is developed consistent with the philosophy and strategy contained in the execution plan. The CMP consists of the following components: cost responsibllities, system selection, cost organization and data flow. On each project, the development of the CMP should begin with the contractor's standard cost reporting and management procedures. The contractor must prepare and maintain commitment/cash flow profiles for the entire scope of the work. The budgets are derived from estimates prepared using all of the design and cost information available at the time. The trend program is a control tool developed to assist in the effective management of project costs and schedule. In order to identify and quantify cost exposures and possible schedule delays, risk/ contingency analyses are performed.
